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The following data applies to a New System to be implemented in a company: Investment cost in n = 0: $10,000 Investment cost in n
The following data applies to a New System to be implemented in a company: Investment cost in n = 0: $10,000 Investment cost in n = 1: $ 15,000 Shelf life: 10 years Residual value (at the end of 11 years): $ 5,000 Annual income: $ 12,000 per year Annual expenses: $ 4,000 per year MARR: 12% Note: The first income and expenses will occur at the end of year 2. Requirements: A. Determine the conventional payback period Period Cash Flow Accumulated Cash Flow B. Determine the discounted payback period Period Cash Flow Cost of Funds Accumulated Cash Flow
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